Apple released a document where they explain how the Apple Watch reads your heartbeat, and where to find the information. Including some tips to get better results, there is one paragraph I love (emphasis mine):

"Heart rate is just one of many factors that Apple Watch uses to measure your activity and exercise. Depending on your workout, it selects the most appropriate inputs for that activity. For example, when you’re running indoors, it also uses the accelerometer. When you’re cycling outdoors, it uses the GPS in your iPhone. And even when you’re not in a dedicated workout, it tracks how much you move each day. So Apple Watch can give you the information — and the motivation — to improve your fitness and your health."